Price growth during the next three years is expected to remain moderate; although suppliers’ input costs will rise at a slower pace than they have during the past three years, demand growth will accelerate slightly.
Los Angeles, CA (PRWEB) August 12, 2014
Wooden shipping crates and boxes have a buyer power score of 3.3 out of 5, reflecting moderate negotiating power for buyers. Buyer purchasing power has declined over the three years to 2014. Price movements for market products are largely dependent on industrial production, exports and the number of new car sales. “These drivers have grown at medium to strong rates as the economy has rebounded after the recession, contributing to moderate price growth for wooden shipping crates and boxes,” says IBISWorld procurement analyst Hayden Shipp. Prices are forecast to continue growing moderately over the next three years as the economy improves further and more shipping services are demanded.
Significant price growth for lumber, suppliers' primary expense, has also driven up prices for wooden shipping crates and boxes. As input costs rose, suppliers with already-low profit margins passed on a portion of their cost increases to buyers in the form of higher prices. Although prices rose, suppliers' profit margins declined, limiting discount availability. Also, this market's moderate specialization makes it somewhat difficult for buyers to find suppliers that meet their specific product requirements. “While some buyers can leverage the availability of substitute products in negotiations, these substitutes are generally not as cost-effective or customizable as wooden crates,” adds Shipp.
Buyer power is heightened by low market share concentration, coupled with significant competition among suppliers. Suppliers engage in a high level of price-based completion to win and retain customers in a saturated market. As a result of these conditions, buyers can obtain favorable contractual agreements through bulk purchases of wooden crates and boxes at lower per-unit costs. Long-term contracts can also mitigate price increases through price caps and controls, as suppliers will be more willing to include favorable terms in contracts that ensure steady cash flow over long periods. Additionally, buyers benefit from low price volatility. Although prices are rising, low price volatility allows buyers to accurately budget for future expenditures. These pricing dynamics also ensure that locking down rates early will lower costs. For more information, visit IBISWorld’s Wooden Shipping Crates & Boxes procurement category market research report page.
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IBISWorld Procurement Report Key Topics
This report is intended to assist buyers of wooden shipping crates and boxes, which are typically used for transporting and storing goods. Wooden shipping crates and boxes are available in custom or standard sizes. Market products vary from small wooden boxes to large, oversized industrial crates that hold products such as automobile parts, aircraft parts, machines, motorcycles, fine arts or sculptures, and other high-value items that require significant protection during shipping. This report does not include plastic or metal shipping crates, corrugated packaging boxes or bags.
Recent Price Trend
Product Life Cycle
Total Cost of Ownership
Supply Chain & Vendors
Supply Chain Dynamics
Supply Chain Risk
Market Share Concentration
Buying Lead Time
Key RFP Elements
Buyer Power Factors
About IBISWorld Inc.
IBISWorld is one of the world's leading publishers of business intelligence, specializing in Industry research and Procurement research. Since 1971, IBISWorld has provided thoroughly researched, accurate and current business information. With an extensive online portfolio, valued for its depth and scope, IBISWorld’s procurement research reports equip clients with the insight necessary to make better purchasing decisions, faster. Headquartered in Los Angeles, IBISWorld Procurement serves a range of business, professional service and government organizations through more than 10 locations worldwide. For more information, visit http://www.ibisworld.com or call 1-800-330-3772.